The difference between economies of scale and economies of scope is:
A) economies of scale occur whenever inputs can be shared in the production of different products
B) economies of scope occur whenever inputs can be shared in the production of different products
C) economies of scale can occur when two or more products are produced
D) economies of scope can occur when two or more products are produced
E) both b and d

Question

​The difference between economies of scale and economies of scope is:
A) ​economies of scale occur whenever inputs can be shared in the production of different products
B) ​economies of scope occur whenever inputs can be shared in the production of different products
C) ​economies of scale can occur when two or more products are produced
D) ​economies of scope can occur when two or more products are produced
E) both ​b and d

Quizplus · Accepted Answer

Economies of scale refer to the cost advantage that a company gains when it increases the scale of production. Economies of scope refer to the cost advantage that a company gains when it produces multiple products using common resources. Both options B and D mention the sharing of inputs in the production of multiple products, which is the defining characteristic of economies of scope. Therefore, the correct answer is E, as it includes both options.

​The Difference Between Economies of Scale and Economies of Scope

The Difference Between Economies of Scale and Economies of Scope